Chesapeake paying $510 million for oil and gas assets in three deals

By OGJ editorsHOUSTON, Dec. 22 -- Chesapeake Energy Corp., Oklahoma City, announced three transactions in which it is paying $510 million total for oil and natural gas assets in the Mid-Continent, Permian basin, and onshore Gulf Coast.

The independent is buying Concho Resources, Midland, a private company, for $420 million. That deal is expected to close on Jan. 30.

Chesapeake also is buying two smaller properties for $90 million, and one of those transactions already closed. The other transaction is expected to close in January. The smaller transactions involve assets in the Permian basin and in Goliad County, Tex.

To account for the transactions, Chesapeake increased its 2004 production forecast. The transactions are expected to enable the company to produce 890 MMcfed compared with its initial 2004 production forecast of 820 MMcfed.

Chesapeake said 89% of its anticipated 2004 production is gas with 11% from oil and natural gas liquids.